Environment, Development and Sustainability

, Volume 19, Issue 2, pp 549–569 | Cite as

Employment implications of stricter pollution regulation in China: theories and lessons from the USA

Article
  • 371 Downloads

Abstract

While the goal of reducing environmental impact has become an urgent imperative for Chinese leadership, the central and potentially competing objective for policy makers and planners remains economic growth and job creation. This paper systematically examines the perceived trade-offs between pollution control regulation and employment at the microeconomic and macroeconomic scale. We synthesize the theoretical literature on the employment impact of pollution control regulation at the firm, industry, and economy levels and summarize the theoretically sufficient conditions for employment-enhancing regulation. The paper examines the US experience with the impact of pollution control on job growth in the 1980s and 1990s and draws out the mechanisms through which job growth and pollution control can be congruent, examining their adaptability to the Chinese context. Specifically, this paper highlights the importance of targeting regulations toward sectors where labor costs represent a small portion of overall costs or sectors with low labor intensity. We demonstrate that in the Chinese context, a transition to an economy with a higher proportion of tertiary output is likely to facilitate a joint strategy of stringent pollution control combined with job growth.

Keywords

Environmental regulation Employment Green jobs China 

References

  1. Air Quality Management District, South Coast. (1997). The Southland’s war on smog: Fifty years of progress toward clean air. Diamond Bar, CA: Authors. Retrieved from http://www.aqmd.gov/news1/Archives/History/marchcov.html
  2. Aldy, J. E., & Pizer, W. A. (2013). The employment and competivness impacts of power-sector regulations. In C. Coglianses, A. M. Finkel, & C. Carrigan (Eds.), Does regulation kill jobs?. Philadelphia: University of Philadelphia Press.Google Scholar
  3. Ambec, S., Cohen, M. A., Elgie, S., & Lanoie, P. (2013). The porter hypothesis at 20: Can environmental regulation enhance innovation and competitiveness? Review of Environmental Economics and Policy, 7(1), 2–22.CrossRefGoogle Scholar
  4. Berman, E., & Bui, L. T. M. (1997). Clearing the air—The impact of air quality regulations on jobs. Washington, DC: Economic Policy Institute.Google Scholar
  5. Berman, E., & Bui, L. T. M. (2001). Environmental regulation and labor demand: evidence from the South Coast Air Basin. Journal of Public Economics, 79(2), 265–295.CrossRefGoogle Scholar
  6. Bezdek, R. H., Wendling, R. M., & DiPerna, P. (2008). Environmental protection, the economy, and jobs: National and regional analyses. Journal of Environmental Management, 86(1), 63–79.CrossRefGoogle Scholar
  7. Bureau of Labor Statistics. (2009). Unemployment in October 2009. Washington, DC: Authors. Retrieved June 30, 2014, from http://www.bls.gov/opub/ted/2009/ted_20091110.htm
  8. California Air Resources Board. (2013). Ambient air quality standards. Sacramento, CA: Authors. Retrieved from http://www.arb.ca.gov/research/aaqs/aaqs2.pdf
  9. California Energy Commision. (2013). Tracking progress: Energy efficiency. Sacramento, CA: Authors. Retrieved from http://www.energy.ca.gov/renewables/tracking_progress/documents/energy_efficiency.pdf
  10. California Energy Commission. (2014). California energy demand 2014–2024 baseline final forecast—Mid demand case residential. Sacramento, CA: Authors.Google Scholar
  11. California Environmental Protection Agency. (2014). California air basin map. Sacramento, CA: Authors. Retrieved May 1, 2014, from http://www.arb.ca.gov/ei/maps/statemap/abmap.htm
  12. Cao, J., Ho, M. S., & Jorgenson, D. W. (2009). The local and global benefits of green tax policies in China. Review of Environmental Economics and Policy, 3(2), 189–208.CrossRefGoogle Scholar
  13. Chen, Y. Y. (2011). Effect of industrial environmental regulations in employment: Empirical research on 25 industries. Modern Economic Science, 11, 67–73.Google Scholar
  14. Cole, M. A., & Elliott, R. J. (2007). Do environmental regulations cost jobs? An industry-level analysis of the UK. B.E. Journal of Economic Analysis and Policy: Topics in Economic Analysis & Policy, 7(1), 1–25.Google Scholar
  15. Environmental Protection Agency. (1997). The benefits and costs of the Clean Air Act, 1970–1990. Washington, DC: Authors. Retrieved from http://www.epa.gov/air/sect812/copy.html.
  16. Enviromental Protection Agency. (1999). The benefits and costs of the Clean Air Act 1990–2010 (EPA publication No. EPA-410-R-99-001). Washington, DC: Authors. Retrieved from http://www.epa.gov/air/sect812/prospective1.html
  17. Enviromental Protection Agency. (2001). Impacts of the acid rain program on coal industry employment. (EPA 430-R-01-002). Washington, DC: Authors. Retrieved from http://www.epa.gov/airmarkets/resource/docs/coalemployment.pdf
  18. Enviromental Protection Agency. (2013). OverviewThe Clean Air Act Amendments of 1990. Washington, DC: Authors. Retrieved from http://epa.gov/oar/caa/caaa_overview.html#titleIV
  19. Florig, K., & Spofford, W. (1994). Economic incentives in China’s environmental policy. Washington: Resources for the Future.Google Scholar
  20. Francesch-Huidobro, M., Lo, C. W. H., & Tang, S. Y. (2012). The local environmental regulatory regime in China: Changes in pro-environment orientation, institutional capacity, and external political support in Guangzhou. Environment and Planning-Part A, 44(10), 2493.CrossRefGoogle Scholar
  21. Gilley, B. (2012). Authoritarian environmentalism and China’s response to climate change. Environmental Politics, 21(2), 287–307.CrossRefGoogle Scholar
  22. Goodstein, E. S. (1996). Jobs and the environment: An overview. Environmental Management, 20(3), 313–321.CrossRefGoogle Scholar
  23. Goodstein, E. S. (1999). The trade-off myth: Fact and fiction about jobs and the environment. Washington, DC: Island Press.Google Scholar
  24. Gray, W. B., & Shadbegian, R. J. (2013). Do the job effects of regulation differ with the competitive environment. In C. Coglianese, A. M. Finkel, & C. Carrigan (Eds.), Does regulation kill jobs. Philadelphia, PA: University of Pennsylvania Press.Google Scholar
  25. Greenstone, M. (2002). The impacts of environmental regulations on industrial activity: evidence from the 1970 and 1977 Clean Air Act Amendments and the census of manufactures. Journal of Political Economy, 110(6), 1175–1219.CrossRefGoogle Scholar
  26. Gutierrez, C. M., Sampson, D. A., Glassman, C. A., & Kincannon, C. L. (2007). Annual capital expenditures: 2005. Washington, DC: US Census Bureau.Google Scholar
  27. Gutierrez, C. M., Sullivan, J. J., Glassman, C. A., & Murdock, S. H. (2008). Pollution abatement costs and expenditures: 2005. Washington, DC: US Census Bureau.Google Scholar
  28. Harris, P., Petrie, D., & Saxton, S. (2010). California’s green economy: summary of survey results. Sacramento, CA: Employment Development Department. Retrieved from http://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/CA-Green-Economy-SummarySurveyResults.pdf
  29. He, G., Lu, Y., Mol, A. P., & Beckers, T. (2012). Changes and challenges: China’s environmental management in transition. Environmental Development, 3, 25–38.CrossRefGoogle Scholar
  30. Ho, Mun S., & Nielsen, Chris P. (Eds.). (2007). Clearing the air: The health and economic damages of air pollution in China. Cambridge, MA: MIT Press.Google Scholar
  31. Hoag, J. H., & Reed, J. D. (2002). The impact of the clean air acts on coal mining employment in Kentucky. Journal of Regional Analysis and Policy, 32(2), 17.Google Scholar
  32. International Labor Organization [ILO]. (2014). Years: 19872008, Country(ies): CN, US, Group of topics: Main statistics (annual), Table: 2B Total employment, by economic activity (Thousands). Retrieved from ILO database.Google Scholar
  33. Johnson, T. (2010). Environmentalism and NIMBYism in China: Promoting a rules-based approach to public participation. Environmental Politics, 19(3), 430–448.CrossRefGoogle Scholar
  34. Kavalec, C., Fugate, N., Alcorn, B., Ciminelli, M., Gautam, A., et al. (2014). California energy demand 2014–2024 final forecast, volume 1: statewide electricity demand, end-user natural gas demand, and energy efficiency. California Energy Commission, Electricity Supply Analysis Division.Google Scholar
  35. Laitner, S., Bernow, S., & DeCicco, J. (1998). Employment and other macroeconomic benefits of an innovation-led climate strategy for the United States. Energy Policy, 26(5), 425–432.CrossRefGoogle Scholar
  36. Lanoie, P., Patry, M., & Lajeunesse, R. (2008). Environmental regulation and productivity: New findings on the Porter Hypothesis. Journal of Productivity Analysis, 30, 121–128.CrossRefGoogle Scholar
  37. Leontief, W. (1970). Environmental repercussions and the economic structure: An input–output approach. Review of Economics and Statistics, 52(3), 262–271.CrossRefGoogle Scholar
  38. Lu, Y. (2011). Green policies and jobs in China: A double dividend? Economic Research Journal, 7, 42–54.Google Scholar
  39. Marx, A. (2000). Ecological modernization, environmental policy and employment. Can environmental protection and employment be reconciled? Innovation, 13(3), 311–325.Google Scholar
  40. McEvoy, D., Gibbs, D. C., & Longhurst, J. W. S. (2000). The employment implications of a low-carbon economy. Sustainable Development, 8(1), 27–38.CrossRefGoogle Scholar
  41. Morgenstern, R. D. (2013). Analyzing the employment impacts of regulation. In C. Coglianese, A. M. Finkel, & C. Carrigan (Eds.), Does regulation kill jobs. Philadelphia, PA: University of Pennsylvania Press.Google Scholar
  42. Morgenstern, R. D., Pizer, W. A., & Shih, J.-S. (2002). Jobs versus the environment: An industry-level perspective. Journal of Environmental Economics and Management, 43(3), 412–436.CrossRefGoogle Scholar
  43. National Bureau of Statistics of China. (1991). China statistical yearbook 1990. Beijing, China: China Statistical Press.Google Scholar
  44. National Bureau of Statistics of China. (1992). China statistical yearbook 1991. Beijing, China: China Statistical Press.Google Scholar
  45. National Bureau of Statistics of China. (1993). China statistical yearbook 1992. Beijing, China: China Statistical Press.Google Scholar
  46. National Bureau of Statistics of China. (1994). China statistical yearbook 1993. Beijing, China: China Statistical Press.Google Scholar
  47. National Bureau of Statistics of China. (1995). China statistical yearbook 1994. Beijing, China: China Statistical Press.Google Scholar
  48. National Bureau of Statistics of China. (2009). China population and employment yearbook 2008. Beijing, China: China Statistics Press.Google Scholar
  49. National Bureau of Statistics of China. (2010). China population and employment yearbook 2009. Beijing, China: China Statistics Press.Google Scholar
  50. National Bureau of Statistics of China. (2011). China population and employment yearbook 2010. Beijing, China: China Statistics Press.Google Scholar
  51. National Bureau of Statistics of China. (2012). China population and employment yearbook 2011. Beijing, China: China Statistics Press.Google Scholar
  52. National Bureau of Statistics of China. (2013a). 2013 China population and employment statistics yearbook, table 0401, 0402, 0403. Beijing, China: China Statistical Press.Google Scholar
  53. National Bureau of Statistics of China. (2013b). China statistical yearbook 2013, table 4.1—Employment. Beijing, China: China Statistical Press.Google Scholar
  54. Nestor, D. V., & Pasurka, C. A, Jr. (1995). Environment-economic accounting and indicators of the economic importance of environmental protection activities. Review of Income and Wealth, 41(3), 265–287.CrossRefGoogle Scholar
  55. Porter, M. E., & Van der Linde, C. (1995). Toward a new conception of the environment–competitiveness relationship. Journal of Economic Perspectives, 9(4), 97–118.CrossRefGoogle Scholar
  56. Renner, M. (2000). Working for the environment: A growing source of jobs. Worldwatch Paper, 152. Washington, DC: Worldwatch Institute.Google Scholar
  57. Roland-Holst, D. (2008). Energy efficiency, innovation, and job creation in California. Berkeley, CA: University of California Berkeley.Google Scholar
  58. Shen, L., & Andrews-Speed, P. (2001). Economic analysis of reform policies for small coal mines in China. Resources Policy, 27(4), 247–254.CrossRefGoogle Scholar
  59. Shen, L., Gao, T.-M., & Cheng, X. (2012). China’s coal policy since 1979: A brief overview. Energy Policy, 40, 274–281.Google Scholar
  60. The State Council. (2006). The 11th five-year plan. Beijing, China: Authors. Retrieved 07/01/2014, from http://english.gov.cn/special/115y_index.htm
  61. The World Bank. (2014a). China overview. Washington, DC: Authors. Retrieved Jan 07, 2014, from http://www.worldbank.org/en/country/china/overview
  62. The World Bank. (2014b). Gross Domestic Savings (% GDP), China. Washington, DC Retrieved from http://data.worldbank.org/indicator/NY.GDS.TOTL.ZS
  63. The World Bank (2015). World development indicators, GDP per Capita time series. Washington, DC. Retrieved from: http://data.worldbank.org/indicator/NY.GDP.PCAP.CD
  64. The World Bank (2015). World development indicators, CO 2 emissions time series. Washington, DC. Retrieved from: http://data.worldbank.org/indicator/EN.ATM.CO2E.PC
  65. Thomas, W. (2009). Do Environmental regulations impede economic growth? A case study of the metal finishing industry in the South Coast Basin of Southern California. Economic Development Quarterly, 23(4), 329–341.CrossRefGoogle Scholar
  66. US Census Bureau. (2014). Table 1. Annual Estimates of the Population for the United States, Regions, States, and Puerto Rico: April 1, 2010 to July 1, 2012 (NST-EST2012-01), Table 1. Annual Estimates of the Resident Population for the United States, Regions, States, and Puerto Rico: April 1, 2000 to July 1, 2009 (NST-EST2009-01).Google Scholar
  67. Wen, J. B. (2011). Report on the Work of the Government. Beijing, China: The State Council.Google Scholar
  68. Wu, R. D., Zhang, S., Yu, D. W., Zhao, P., Li, X. H., Wang, L. Z., et al. (2011). Effectiveness of China’s nature reserves in representing ecological diversity. Frontiers in Ecology and the Environment, 9(7), 383–389.CrossRefGoogle Scholar
  69. Yan, W. J., Guo, S. L., & Shi, Y. D. (2012). Environmental regulation, industrial structure upgrading and employment effects. Economic Science, 6, 23–32.Google Scholar
  70. Zhang, K. M., & Wen, Z. G. (2008). Review and challenges of policies of environmental protection and sustainable development in China. Journal of Environmental Management, 88(4), 1249–1261.CrossRefGoogle Scholar
  71. Zhou, N., Levine, M. D., & Price, L. (2010). Overview of current energy-efficiency policies in China. Energy policy38(11), 6439–6452.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2015

Authors and Affiliations

  1. 1.Earth InstituteColumbia UniversityNew YorkUSA
  2. 2.Earth InstituteColumbia UniversityNew YorkUSA
  3. 3.Earth InstituteColumbia UniversityNew YorkUSA

Personalised recommendations